Heat pump vs gas, oil & propane — running cost by state
Annual operating cost of a heat pump compared with a furnace or boiler, using EIA residential fuel prices for all 51 states.
A heat pump delivers 2-3x more heat per unit of energy than any furnace can burn, so it is almost always cheaper to run than propane, heating oil and electric-resistance heat. Versus cheap natural gas the answer is closer and depends on your state: where electricity is dear and gas is cheap, a 95% gas furnace can still win on running cost. This tool converts every fuel to the same useful-heat unit (BTU) with the ENERGY STAR constants and prices it at your state's EIA rates. It is an estimate — verify with an HVAC pro.
Source: EIA Electric Power Monthly, Table 5.6.A (residential). Data as of June 2026.
Compare your heating cost
Pick your state, climate zone and home size; the calculator prefills your EIA fuel prices (edit them to match your bill) and shows the annual energy cost of each heating system side by side.
Want the full method and a worked example? See the calculator page and the methodology.
Where a heat pump saves the most vs natural gas
For a reference 2,000 sq ft home in each state's typical climate zone, comparing a heat pump against a 95% AFUE gas furnace at that state's EIA prices. Positive = the heat pump is cheaper to run.
| State | Heat pump $/yr | Gas furnace $/yr | Heat-pump result |
|---|---|---|---|
| Arkansas | $514 | $897 | Saves $384/yr |
| Hawaii | $619 | $989 | Saves $370/yr |
| Texas | $240 | $400 | Saves $159/yr |
| Kentucky | $561 | $699 | Saves $138/yr |
| Oregon | $561 | $657 | Saves $96/yr |
| Arizona | $228 | $320 | Saves $91/yr |
Where natural gas still wins on running cost
| State | Heat pump $/yr | Gas furnace $/yr | Heat-pump result |
|---|---|---|---|
| Alaska | $3,026 | $1,000 | Costs $2,026/yr more |
| Maine | $3,154 | $1,254 | Costs $1,900/yr more |
| Vermont | $2,685 | $1,290 | Costs $1,395/yr more |
| Wisconsin | $2,094 | $731 | Costs $1,363/yr more |
| New Hampshire | $2,998 | $1,641 | Costs $1,357/yr more |
| Rhode Island | $2,045 | $924 | Costs $1,122/yr more |
See the full saves-most and gas-still-cheaper rankings, or your state page.
Browse
Heat pump vs every fuel at your prices.
All 51 statesYour state's fuel prices + worked comparison.
Compare fuelsHeat pump vs gas / propane / oil / electric.
LearnAFUE, HSPF, COP and SEER explained.
RankingsWhere heat pumps save most & least.
Blog2026 rebates, cold-climate, sizing.
Frequently asked questions
Is a heat pump cheaper to run than a gas furnace?
It depends on your electricity price, your natural-gas price and the heat pump's seasonal efficiency (COP). Because a heat pump delivers 2-3x more heat per unit of energy than a furnace burns, it usually beats propane, heating oil and electric resistance heat almost everywhere. Versus cheap natural gas it is closer: in states with low gas prices and high electricity prices, a 95% gas furnace can still be cheaper to run. Use the calculator with your own prices.
How do you compare heating costs across different fuels?
Every fuel is converted to the same useful-heat unit (BTU) using the ENERGY STAR energy-content constants. Cost = (annual heat demand / efficiency) / (BTU per unit of fuel) x price per unit. For a heat pump, useful heat = electricity (kWh) x 3,412 x seasonal COP, so a COP of 2.5 means each kWh delivers 2.5x the heat of electric resistance.
What efficiency numbers does this use?
Default assumptions (all editable): natural gas furnace 95% AFUE, propane 92% AFUE, heating oil 85% AFUE, electric resistance COP 1.0, and a heat-pump seasonal COP of 2.0-3.2 depending on climate zone. These are disclosed on every page and on the methodology page.
Are there rebates that change the math?
Yes - the upfront cost (not the running cost) can drop a lot. The federal 25C tax credit and the High-Efficiency Electric Home Rebate / HOMES programs, plus many state and utility rebates, lower the install cost of a qualifying heat pump. This site compares operating cost; see the blog for the 2026 rebate context and check your utility and state energy office.
Sources & accuracy
Fuel prices: EIA Electric Power Monthly, Table 5.6.A (residential) (March 2026), EIA residential natural gas and EIA heating oil & propane — all U.S. public domain. Energy-content constants from ENERGY STAR Thermal Energy Conversions. Figures are estimates for general information, not a quote or engineering analysis. Actual savings depend on your home, equipment, climate and rates — verify with an HVAC professional. See our methodology and disclaimer.
Last updated: 2026-06-29